The Reliance Jio Conundrum: What’s all the fuss about?

In September 2016, Reliance Jio launched their 4G services all over India. The company offered its users free Internet and voice calls right till the end of December 2016. In a bid to be the recipient of this offer, hordes of people stood in long queues outside Reliance outlets to get the Jio SIM. If statistics are to be believed, Reliance Jio users consume somewhere around 18 GB of data on an average every month.

With 15 million people already using Reliance Jio, which they acquired in the first month itself, the number of subscribers is expected to grow manifold in coming days, if all goes well.

Recently, Reliance Jio has officially launched a pilot program for home deliveries of their SIM cards. Aimed at the biggest cities in India, the service will help consumers get their hands on a Jio SIM without having to wait in queues at stores.

What’s big deal aboutJio?
Posing as the face of government’s much touted ‘Digital India’, the Reliance Jio has managed to create stir in telecom space in India. Let’s take a look at the unique propositions that the company has come up with.

Affordable 4G Devices: Along with Jio services, Reliance also launched a new line of affordable 4G VoLTE smartphones under ‘LYF’ brand. The most basic LYF smartphone is priced at Rs. 2999, which gives an edge over other phones in the price bracket.

Data Plans: Reliance Jio base rate for every GB is going to be almost 1/10th of the market rate. Mukesh Ambani said, “We have price points starting from Rs. 19 for the occasional data user, to a monthly Rs. 149 plan for the light data user all the way up to a monthly Rs. 4999 plan for the heaviest data user. Data packs in the market have an effective rate of about Rs. 250 per GB. With Jio, you pay 5 to 10 times lower – Rs. 25-50 per GB”.

Voice Calls: During the launch of Jio, Mukesh Ambani also stated that all voice calls will be free for Jio customers and recently the company reaffirmed the same. What’s more, there are going to be no hefty roaming charges anywhere in India with Reliance Jio. Incumbent operators including Bharti Airtel and Vodafone approached Telecom Regulatory Authority of India (TRAI) against free call service being offered by Jio, calling the tariff plan predatory and discriminatory. However, TRAI gave a clean chit saying the tariff plans filed with TRAI cannot be considered as IUC non-complaint, predatory and discriminatory, at present.

What’s next for Reliance Jio?
The next big thing for Reliance Jio is its FTTH (Fiber to the Home) service. The main aim of this service is to bring wired broadband in India that has a speed of up to 1 Gbps. When you buy this service, you will also be provided with an Android smartbox as well as a set-top box for Jio TV. This set-top box has another function – it serves as a router as well, around 44 devices can be connected to this router at a given point in time.

What’s the fuss about?
The entry of Reliance Jio has shaken things up the Indian telecom industry. There have been unprecedented drops in call and data rates of all major telcos since Jio’s launch.

With the free Internet and voice calls offered by Jio, more and more people are switching to Jio. But, as per the Telecom Tariff Order, the minimum interconnect rate is 14 paise per minute and Jio is violating this order by offering free calls. Therefore, telecom providers such as Vodafone, Airtel, and Idea accused Reliance Jio of committing anti-competition practices.

Having said, Reliance got a clean chit from both the Government of India. TRAI wrote a letter to the operators in question in which it said, “The tariff plans offered by RJIL and various submissions thereafter have been examined and it is found that the tariff plans filed with TRAI can’t be considered as IUC non-complaint, predatory and discriminatory at present”.

Please note that the much debated “Jio: Digital Life” ad featuring the prime minister of the country Narendra Modi created much furor raising a much bigger question –“why is the prime minister endorsing a private company?’’ Many were even asking the legality of the move. Political experts and advertisement industry stakeholders think that ‘it was highly unlikely that this brand campaign would have occurred without the two parties talking or prior intimation on the part of Reliance,’ as reported by The Wire.

All said and done, with a clean bill of health from TRAI and of course its unmatched services, the company seems to have got a kick-start. Let’s wait and watch how the Jio story unfolds in coming days. After all, competition is always good for consumers.